Softbank profits boosted by Internet investments

CBS.MarketWatch.com

TOKYO (CBS.MW) -- Savvy investing in Internet companies lifted Softbank Corp. to full-year record profit, which saved it from slidding into the red because of losses in its computer publishing business.

Softbank posted group net profit of 37.54 billion yen ($302.5 million) in the year to March 31, up from 10.3 trillion yen. Earnings per share more than tripled to 365 yen from 100 yen while group sales rose 2.9 percent from the previous year to 528.16 billion yen.

The record net profits were fueled by capital gains from the parent's Internet portfolio, in particular the $390 million in capital gains which it earned when it sold 3 million shares in Yahoo! Inc.
YHOO
on February 22.

Losses at Ziff-Davis

But, as Softbank warned three months ago, difficulties at its U.S. publishing subsidiary Ziff-Davis took a heavy toll on pre-tax profits. Softbank posted a pretax loss of 15.4 billion yen from a pre-tax profit of 24.2 billion yen a year ago.

Despite the problems at the U.S. subsidiary, Softbank's shares have more than doubled this year on Internet euphoria, as the company goes about building a virtual financial empire. Softbank's sizable investments include E*Trade for online broking in Japan; Morningstar Japan for providing stock and mutual fund data; InsWeb for insurance products; and E*Loan for mortgages and auto loans.

Softbank did not include a group forecast for the 1999-2000 fiscal year in its earnings report because the forecast for Ziff-Davis, in which it holds a 70 percent stake, were not yet available. Softbank made its report after the close of Tokyo trading. Its shares were down 510 yen to 15,200

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